Malaysia’s end-June palm oil stocks likely dropped to their lowest in a year as demand for the edible oil continued to outstrip supply, a Reuters survey of five plantation companies showed on Thursday.
Inventory levels may have eased 4.2 percent from a month ago to 1.74 million tonnes in June, which would be the sixth straight monthly decline.
Output in the world’s second largest palm oil producer likely rose 6 percent in June from the previous month, its biggest jump so far this year, to 1.47 million tonnes, suggesting the start of a higher production cycle in the second half of the year.
Production, however, still fell short of the 1.59 million tonnes of total demand represented by exports and local consumption.
Shipments rose 2.7 percent to 1.45 million tonnes in June, as buyers from India and Pakistan stocked up in preparation for the Muslim festival of Ramadan in July.
China, the world’s largest palm oil buyer after India, also purchased more volumes last month, cargo surveyor data showed.